On carbon taxes, public-sector workers, Britain, talent, violins

SIR –The Economist continues to propagate the myth that a carbon tax is preferable to carbon trading (“Stopping climate change”, December 5th). There are three good reasons for not favouring a carbon tax over a cap-and-trade solution.

First, a “one size fits all” tax requires an impossible calculation of the average cost of reducing emissions over a given period of time. Compare this with an emissions-trading system that works on the free-floating marginal cost of abating emissions. Second, carbon taxes would be levied locally and so impossible to properly administer on a global scale. A global carbon-market price is perfectly pervasive. And third, taxation cannot guarantee a reduction in greenhouse-gas emissions; emitters could opt to pay the tax and continue emitting at will. Conversely, a cap-and-trade solution introduces a carbon ceiling and the price acts as no more than a useful barometer of how close we are to achieving that goal; prices will tend to zero as the requisite level of emission reductions is achieved.

The latter point dispels the political myth that “we need to establish a carbon price”. Why does it matter if we achieve the necessary quantity of emission abatement at $2 per tonne of CO2 or at $50 per tonne? Our objective ought to be to achieve the environmental goal at the lowest unit cost. This goal can only be accomplished through the flexibility of emissions trading. The carbon-tax argument is as extinct as the dinosaurs.

James EmanuelCommercial directorCantorCO2eLondon

SIR – You asserted that, “economists prefer carbon prices, especially those set by taxes rather than cap-and-trade systems, which are more vulnerable to capture by the polluters.” This implies that someone has actually polled economists on the question, or counted pro and con arguments in the environmental-economics literature, or at least made some effort to ascertain what economists prefer. Those assumptions would be wrong, as there is still plenty of disagreement on carbon pricing versus cap and trade. Your only argument for dismissing cap and trade is its supposedly greater vulnerability to capture. That in itself is doubtful.

Consider an important, and not doubtful, argument on the other side. Finding the “correct” price, or tax, on carbon emissions requires huge amounts of detailed knowledge of the processes behind the emissions and the marginal costs faced by polluters. It is not possible to appeal to trial and error for establishing the right price because of the lags and the inefficiencies implied by the inevitable errors. The great virtue of cap and trade is that the system can be taken directly to the targeted emission reductions. The price that arises out of the market, then, is by definition the correct one.

SIR – You have published a special report on climate change (December 5th) that is pivoted on the apparent acceptance of projections based on data that neither you nor I have been allowed to see or question openly. It is sad to see the newspaper that I have held in such high esteem blindly prostitute itself to the warmist-brigade consensus on alleged man-made climate change. Be brave like the small child who saw and said that the emperor was wearing no clothes.

Carl ThueyTunbridge Wells, Kent

* SIR – The recent letter (December 12th) from Lou Zeidberg shows precisely why so many of us have real issues with the “science” behind man-made global warming. The gentleman argues that “the consensus view of the respective groups of every advanced nation on climate change cannot be ignored while we wait for an unobtainable golden thread of evidence”.

If the science behind the theory is sound, why is this evidence “unobtainable”; we are dealing with physical matter are we not? Taxpayers around the world are expected to fund literally billions of dollars to tackle the problem. Surely the least their leaders can do is show that their decision is based on definitive evidence, not computer models and predictions. We are not talking of small sums here, but massive transfers of wealth.

Michael PottsMonmouth, Monmouthshire

SIR – It is important to keep the debate on climate change alive, so both sides should be grateful for each other. We could learn a lesson from the film, “12 Angry Men”. Henry Fonda's lone sceptic holds firm against 11 angry jurors to prevent a possibly wrongful conviction. He does this by focusing on the evidence and not making personal attacks. Each side of the debate on global warming would do well to consider how they measure up to this standard.

SIR – That you regard public-sector workers to be “coddled” and “spoiled rotten” because of their health-care benefits and pensions says more about you than the workers (“Welcome to the real world”, December 12th). You even distorted the evidence, claiming that public employees earn more than those in the private sector. As the Bureau of Labour Statistics makes clear, when comparing pay within occupations public employees do not receive more than their counterparts in the corporate world.

We believe that all American workers deserve decent health care and a secure retirement. The decline of unions in the private sector is one reason why those benefits are not shared by more families. Contrary to what you might think, it is not government employees who brought the American economy and state and local budgets to the brink of disaster. Rather than attack public employees for negotiating good contracts, we should expand the ability of all workers to bargain for better wages and benefits so that they and their families can share in the American Dream.

Gerald McEnteePresidentAmerican Federation of State, County and Municipal EmployeesWashington, DC

* SIR – You indicated that public employees are paid more than private employees and are more likely to have access to health care and participate in a defined-benefit pension plan. But you did not show that public workers are also older, better educated and more likely to be in professional occupations than the private-sector workforce and that much, if not all, of their pay advantage is associated with these characteristics.

More than 30 years of research has demonstrated that apparent public-sector wage advantages are greatly reduced once characteristics such as education, age and occupation are taken into consideration.

* SIR – Public-sector unions have entrenched their privileges through a combination of political dynamics that have proven extremely difficult to overcome. For example, the ability of taxpayers to move away from jurisdictions where they consider the pay of public employees to be excessive is severely circumscribed by the costs of moving itself.

The benefits enjoyed by unionised government workers give those workers a very strong incentive to work to influence the political process. By contrast, the taxpayers who must bear the costs of those benefits do not have a comparable incentive for political involvement, because those costs are widely diffuse and therefore are not as visible. Such an arrangement can only last so long before it runs headlong into economic reality, as the 2008 bankruptcy of Vallejo, in California, made clear.

SIR – Bagehot made the point that “‘Good luck to him' was once a characteristic British attitude to self-made wealth” (December 12th). Unlike you, I believe it still is. What riles the British is wealth made through inherited or institutional privilege, monopoly, manipulation of regulation, consumer rip-offs, and, as in bankers' bonuses, gambling with other people's money, losing, being rescued by the taxpayer, having no bloody gratitude and expecting to start the whole scandalous round all over again.

I believe that Britons have as much regard, admiration and absence of jealousy as they ever did for entrepreneurs who succeed through talent or a bright idea exploited through sheer hard work. We also like (though we might be jealous of) a truly lucky winner like a lottery millionaire and admire (though we might think them cocky) a successful TV talent-show contestant who has the guts to run the gauntlet of judges and audience.

Baroness Sarah Ludford, MEPLondon

Executive search

* SIR – Permit me to correct several contentions you made about traditional executive-search in your useful article on talent (Schumpeter, December 12th). Firstly, that executive-search firms only consider executives in current employment. This is not the case and, if it ever was, has not been so for many years. We live in a far more mobile society than ever before and most boards and top management recognise that not only is executive talent scarce but, given the volatility of the business environment, the vagaries of corporate politics and changes in corporate strategy, very talented people can often find themselves “on the market” through no fault of their own. It would be negligent of search firms to ignore such individuals and I can assure you that they do not.

The other contention is that search firms take a long time, six months, to fill corporate vacancies. It would be silly to pretend that this cannot happen. It can and does for a number of different reasons. However, this is far from typical and in these more virtual times it is much more likely that a search will be completed considerably more quickly than this and the candidate actually be in place in his or her new job well within six months.

SIR – Italian violin-makers were not the sole master craftsmen of the art during the 18th century (“Older and richer”, December 19th). Around 1715 Daniel Parker, an English violin-maker working in London, visited Stradivari's Cremona workshop, where he acquired an abundance of the master's secrets, such as the ingredients used to varnish the instrument, wood-ageing and carving techniques, which were unknown to the outside world.

Upon returning to London, Parker produced instruments with so gorgeous a tone that when Fritz Kreisler performed on his Daniel Parker violin two centuries later, no one in the audience, not even violin-makers or music critics, could believe that he was not playing his own Strad.

Les DreyerRetired violinist of the Metropolitan Opera orchestraNew York